Birth Pains for Medi-Cal’s Shift to Managed Care
The state of California has been mailing hundreds of thousands of packets to recipients of Medi-Cal, its principal health insurance program for the poor, instructing them on how to enroll in managed care. The idea behind the packets is a good one: Managed care has a proven if sometimes inconsistent record of providing economical, quality health care for privately insured Americans, so why not use the same system to control the soaring health care costs of public aid?
But as always, the devil is in the details, and the way the state has gone about moving Medi-Cal recipients into managed care has aroused legitimate anger and confusion among recipients, physicians and the U.S. government. Last month, the federal Health Care Financing Administration (HCFA) ordered Sacramento to delay implementing key parts of its plan that were to have gone into effect today.
What most worried the HCFA were the information packets being sent to Medi-Cal recipients in Los Angeles County. An inch thick, they contained a bevy of obscurely written pamphlets that might daunt even Paul Ellwood, the policymaker who coined the term “health maintenance organizations.”
The HCFA did not make clear to state officials how to explain the process to the recipients. But at a minimum, Sacramento must boil down the details of the new managed care program to a few pages, and these should be mailed to all Medi-Cal recipients and also sent to traditional Medi-Cal physicians as well as agencies like the state Department of Social Services that serve Medi-Cal patients.
Even if the state takes such precautions, however, many patients will still “default,” or fail to respond to its mailers. Currently, Sacramento randomly assigns such patients to health care providers located within their area. (The state claims it has solved an earlier problem wherein patients were assigned to physicians hundreds of miles away.)
The most sensible plan, however, would simply assign defaulting patients to their current physician. Such assignments would not cost the state more money, for it pays the same monthly fees to all California physicians.
One wouldn’t think that California physicians would be competing for Medi-Cal patients, for the state’s compensation rate ($75 per patient per month) is among the lowest in the nation. But in fact, Medi-Cal recipients are being courted by numerous health care providers largely for one reason: The providers get the $75 per month whether or not they actually see the patient, and often they don’t. That’s what makes for the competition.
So in addition to doing a better job of guiding Medi-Cal recipients through the maze that is managed care, Sacramento must also ensure that the providers it selects care as much about their patients as they do about their patient dollars.
